COAL supplier Hargreaves Services may be forced to shut a South Yorkshire mine, putting 500 jobs at risk despite posting record profits.

The group’s shares plunged a fifth, down 143p to 551p, as it said it was reviewing safety at its Maltby mine in Rotherham, one of only five remaining deep mines in the UK, because of concerns over water, oil and gas seepage.

A decision on its future will be made by the end of next month. Chief executive Gordon Banham said it did not want to “take a risk with people” and that the £36million cost of moving production to another seam in the mine would not be supported by shareholders.

He stressed that it would try to redeploy as many of the 500 jobs as possible if the mine was shut.

Maltby produces more than one million tonnes of coal a year, of which 60 per cent is supplied to Drax, Europe’s largest coal-fired power plant.

Banham said it had found alternative coal supplies for the contract from the US.

It posted record profits of £43.1million, up 16.8 per cent on last time on revenues 24.6 per cent better at £688.3million, helped by demand from steelmakers.